Hon'ble Vivek Kumar Birla,J.
Heard Sri Shashi Nandan, learned senior counsel, assisted by Sri Madhav Jain and Archit Mehrotra, advocates for the petitioners, and Sri M.C. Chaturvedi, learned counsel for the Agra Development Authority.
Sri M.C. Chaturvedi has accepted notice on behalf of respondents no. 1 and 2.
Learned counsel for all the parties agree that the matter be disposed of at this stage itself without waiting for any further affidavits, as the documents that are on record, are sufficient for disposal at this stage.
The challenge raised in this petition is to the order dated 21.7.2014, passed by the Vice-Chairman, Agra Development Authority, Agra, respondent no. 2 and to the impugned communication dated 22.7.2014 of the Assistant Engineer (Estates) of the Development Authority whereby the lease of the petitioners dated 9.7.1998 has been determined and the constructions that are in the shape of garages have been sealed. The petitioner is the builder who has promoted and settled the building to different individuals who are sub-lessees.
The ground of challenge raised in the present petition is that the impugned proceedings of sealing are without jurisdiction inasmuch as no notice was issued or proceedings initiated as per the provisions of U.P. Urban Planning and Development Act, 1973 and, to the contrary, it was on account of the allegations contained in the notice dated 4.7.2014 that the impugned order of determination of the lease has been passed. This also does not conform to the terms of the lease and the determination could have been done on the development authority invoking the arbitration clause in proceedings under the Arbitration and Conciliation Act, 1996.
The allegations in the notice are that separate garages that have been allotted to the sub-lessees to use for parking, were found during inspection that they are being utilized for residential, commercial and other storage purposes, therefore, the terms of the lease have been violated and therefore the lease deserves to be determined.
Sri Shashi Nandan has invited the attention of the Court to the terms of the lease deed that is subject matter of dispute and has been filed as Annexure-2 to the writ petition. The provision for determination of the lease has been provided for as follows:
And also that all such rules or bye-laws made by the Agra Development Authority or Agra Nagar Nigam or any Statutory or Executive Authority from time to time, which are incidental to the possession and upkeep of parking/garage shall be binding on the lessee(s).
Provided always these presents are executed on the express condition that if and whenever the said balance of premium or any part thereof shall be in arrear and unpaid for the space of seven days after the due date whether the same shall have been lawfully demanded or not or if there shall be a breach or non-observance of any of the convenient by the lessee(s) contained in this deed then the lessor, notwithstanding the waiver of any previous cause or right of re-entry, may re-enter into and upon the said premises and the said parking/garages so to be erected as aforesaid or any part thereof and evict the lessee(s) and all transferees/occupiers of the same therefrom as unauthorised occupants and this demise shall stand absolutely determined and the lessee shall forfeit all rights to remove any buildings or recover any compensation for any buildings erected by him/them on the said premises and also in case of breach of any condition mentioned herein by the lessee(s), the lessor accordingly, shall have right to determine the lease by giving the notice under section 106 of T.P. Act.
And also the common spaces, such as corridors, generator rooms, stairs, etc. would be maintained by the lessee and it would be a joint and several liability of the lessee along with its transferees/assignees to maintain the parking/garages & common spaces in good clean and usable condition.
And also in respect of any dispute arising between the parties, it shall be referred to the Vice-Chairman of the Agra Development Authority who shall be the sole arbitrator in the matter and the provisions of the Indian Arbitration and Reconciliation Act, 1996 shall apply thereto, and none of the parties would challenge such Award of the Arbitrator.
And also subject to the conditions mentioned herein before, the lessee shall be bound to incorporate all the aforesaid terms and conditions in the deeds that would be executed by it in favour of its transferees/assignees, and in case of non-mention thereof, the transfer by the lessee shall be void and would not confirm and title or interest upon such transferee/assignee of the lessee.
It is urged that neither any notice has been served as envisaged under the Transfer of Property Act, 1882 on the petitioner nor there is any intention expressed in accordance with the aforesaid provisions for determination of the lease. It is also submitted that the impugned action has been taken in haste, without even taking notice of the aforesaid provisions of the lease, as an executive act performed by the respondent Vice-Chairman on the basis of the office notes that have culminated in passing of the order. It is contended that the Vice-Chairman has, therefore, committed a gross illegality in proceeding to determine the lease as above which is not in accordance with the procedure prescribed under terms and conditions of the lease deed itself.
Sri M.C. Chaturvedi, on the other hand, contends that the terms have been clearly provided and the procedure adopted by the Vice-Chairman, is permissible. He further takes preliminary objection to the effect that if the petitioners are aggrieved, the petitioners can invoke the arbitration clause under the aforesaid provisions of the lease deed itself. As a result whereof the present writ petition would not be entertainable for the cause of action disclosed. He submits that the notice expresses the intention to determine the lease.
The first issue and which issue will govern the future proceedings of this case is as to whether the determination of the lease can be carried out in the manner as done, about which Sri Chaturvedi has raised a dispute that so far as the intention to terminate the lease is concerned, it is already contained in the notice and the form of the notice may not be important so long as the intent is expressed as per Section 106 of the Transfer of Property Act.
Be that as it may, the fact remains that the arbitration clause is available but at the same time the power to seal the premises simultaneously appears to have been exercised without following the procedure of the 1973 Act. Even otherwise such a procedure for sealing is available only for the purpose of unauthorised constructions and does not appear to be available for the purpose of determining the lease which would be governed by the terms of the lease deed.
Consequently, Sri Shashi Nandan is right in his submission that the matter ought to to have been resolved through arbitration and not by an executive fiat of the Vice-Chairman on the basis of an office noting as has been done in the present case. No proceedings of arbitration have been undertaken under the provisions of the Arbitration and Conciliation Act, 1996. It is trite that the procedure prescribed if not followed, a circumvented method which is not in pari-materia with or under the 1996 Act, cannot be a substitute for arbitration.
Accordingly, we allow the writ petition and set aside the order dated 21.7.2014 as well as the communication dated 22.7.2014. The petitioner shall present a copy of this judgement before the Vice- Chairman for the purpose of such determination in terms of the provisions quoted herein above and, upon presentation of such application, the Vice-Chairman shall proceed to enter upon arbitration and pass the appropriate orders in accordance with the 1996 Act and terms of the lease preferably within a period of six months.
It shall be however open to the Development Authority to take such action only in accordance with law against the sub-lessees and assignees, if any violation is reported either under the provisions of 1973 Act and the regulations framed therein or as per the terms of the lease independent of the arbitration dispute with the petitioner.
Order Date :- 28.8.2014 Puspendra